This week has seen various statements by public figures about borrowing and debt. George Osborne announced that the government will legislate to require the UK government to run a budget surplus ‘in normal times’. Meanwhile, the Scottish National Party have tabled an amendment to the Scotland Bill to open up the possibility of full fiscal autonomy for Scotland, arguing that – even if this meant running a deficit in Scotland – this would be possible because ‘the UK has been in deficit in 43 of the last 50 years’. So what level of borrowing can or should the UK or Scotland have in the longer-run?
